Vitol building Malaysian oil refinery to meet new low-sulphur ship fuel rules

MOSCOW (MRC) -- Vitol, the world’s largest independent oil trader, has started building a small oil refinery at its storage terminal in Malaysia that will provide low-sulfur fuel for ships, reported Reuters with reference to a senior company official.

The project consists of a crude distillation unit that can process 30,000 barrels per day of crude and is located on the same site as Vitol’s oil storage terminal at Tanjung Bin in the southern Malaysian state of Johor, Vitol Asia’s President and Chief Executive Officer Kho Hui Meng said.

A construction unit under China National Petroleum Corp (CNPC) is handling the project which will involve moving a second-hand CDU from China to the site, he said on the sidelines of the Asia Oil & Gas Conference.

The project is expected to be completed in May 2020 and will augment Vitol’s refinery in Fujairah in the United Arab Emirates in providing low-sulfur fuel oil for ships, Kho said.

The global shipping industry will switch to marine fuel, known as bunker fuel, containing 0.5% sulfur or less from the start of 2020, down from the current 3.5%, as mandated by the International Maritime Organization.

Companies such as Germany’s Uniper and the United Arab Emirates’ Brooge Petroleum and Gas Investment Co (BPGIC) are either expanding their plants or building a new refinery in Fujairah, a ship refueling hub on the east coast of the UAE, to meet rising demand.

The new Malaysian refinery will be able to process a wide variety of low-sulfur oil available in the market including US West Texas Intermediate crude that Vitol trades in, Kho said.

Production of low-sulfur fuel from Vitol’s new refining unit will be just in time to meet rising demand as current stockpiles of such fuel in the region would have been drawn down by the middle of next year, he said.

Major oil companies and trading houses are stocking up low-sulfur bunker fuels in anticipation of a surge in demand for the fuel in 2020.
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MOSCOW (MRC) -- PetroChina DaQing Refining & Chemical has restarted its polypropylene (PP) unit following an unplanned maintenance work, as per Apic-online.

A Polymerupdate source in China informed that the company has resumed operations at the unit on June 26, 2019. The unit remained off-line for around one week.

Located in Daqing, China, the plant PP unit with production capacity of 300,000 mt/year.

As MRC reported earlier, PetroChina has nearly doubled the amount of Russian crude being processed at its refinery in Dalian, the company’s biggest, since January 2018, as a new supply agreement had come into effect. The Dalian Petrochemical Corp, located in the northeast port city of Dalian, is expected to process 13 million tonnes, or 260,000 bpd of Russian pipeline crude this year, up by about 85 to 90 percent from last year’s level. Dalian has the capacity to process about 410,000 bpd of crude. The increase follows an agreement worked out between the Russian and Chinese governments under which Russia’s top oil producer Rosneft will supply 30 million tonnes of ESPO Blend crude to PetroChina in 2018, or about 600,000 bpd. That would represent an increase of 50 percent over 2017 volumes. The additional oil sent to Dalian is about 120,000 bpd and will make up the bulk of the Russian increases.

PetroChina Company Limited, is a Chinese oil and gas company and is the listed arm of state-owned China National Petroleum Corporation, headquartered in Dongcheng District, Beijing. It is China's biggest oil producer.
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MOSCOW (MRC) -- Pengerang Refining and Petrochemical (PrefChem), a joint venture between Petronas and Saudi Aramco, is expected to restart a crude distillation unit at its oil refinery in Malaysia in July, reported Reuters with reference to sources.

The Pengerang Refining development, part of Petronas’ USD27 billion Pengerang Integrated Complex, consists of a 300,000 barrels-per-day (bpd) oil refinery and a petrochemical complex with a production capacity of 7.7 million tonnes per year in the southern Malaysian state of Johor.

The refinery stopped trial runs in April for safety checks after a fire occurred at the atmospheric residue desulfurization (ARDS) unit.

Contractors are still assessing the extent of damage at the fire-hit ARDS unit and repairs could take between three months and two years, one of the sources said, citing initial estimates.

The CDU will be processing low-sulfur crude in the absence of the desulfurization unit, the sources said.

The ARDS unit was set up to remove sulfur from fuel oil which is then passed through a residue fluid catalytic cracker (RFCC) - a secondary refining unit that upgrades residual fuels into higher quality products such as gasoline. The ARDS unit is located close to the refinery’s CDUs.

The refinery is expected to produce fuel in August-September although output may not meet commercial specifications yet. A 1.2-million-tonnes-per-year naphtha cracker at the site started trial runs this month.

By restarting the CDU in July, the refinery is working toward producing fuel that meets commercial specification by the end of the year, the sources said.

The project, originally known as RAPID, or Refinery and Petrochemical Integrated Development, was to resume operations by the end of this year, Petronas said in a statement last month.

Petronas and PrefChem have not responded to emailed requests for comment.

As MRC wrote earlier, Petronas plans to build a C6-based metallocene linear LDPE plant and a low density polyethylene (LDPE)/ethylene vinyl acetate (EVA) swing plant at its greenfield integrated refinery and petrochemical complex in southern Johor state by mid-2019. The proposed metallocene LLDPE will have a capacity of 350,000 tpa, while the LDPE/EVA will have a capacity of about 150,000 tpa. The two plants are part of Petronas' planned Refinery and Petrochemical Integrated Development project in Pengerang at Johor.

Petronas, short for Petroliam Nasional Berhad, is a Malaysian oil and gas company wholly owned by the Government of Malaysia. The Group is engaged in a wide spectrum of petroleum activities, including upstream exploration and production of oil and gas to downstream oil refining; marketing and distribution of petroleum products; trading; gas processing and liquefaction; gas transmission pipeline network operations; marketing of liquefied natural gas; petrochemical manufacturing and marketing; shipping; automotive engineering; and property investment.
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MOSCOW (MRC) -- ExxonMobil and Global Thermostat said they have signed a joint development agreement to advance breakthrough technology that can capture and concentrate carbon dioxide emissions from industrial sources, including power plants, and the atmosphere, reported Reuters.

The companies will evaluate the potential scalability of Global Thermostat’s carbon capture technology for large industrial use. If technical readiness and scalability is established, pilot projects at ExxonMobil facilities could follow.

"Advancing technologies to capture and concentrate carbon dioxide for storage and potential industrial use is among a suite of ExxonMobil research programs focused on developing lower-emissions solutions to mitigate the risks of climate change," said Vijay Swarup, vice president of research and development for ExxonMobil Research and Engineering Company.

"Our scientists see potential in this exciting technology that could lead to more affordable methods to reduce emissions in power generation and manufacturing, along with removing carbon dioxide from the atmosphere."

ExxonMobil and Global Thermostat are also exploring opportunities to identify economic uses for captured carbon dioxide.

"Scaling solutions that can address climate change globally requires significant investment, innovation and collaboration," said Peter Eisenberger, chief technology officer and co-founder of Global Thermostat.

"Global Thermostat’s game-changing direct-air capture and flue gas capture technologies offer a way to transform the risks associated with carbon dioxide emissions into a global solution that could satisfy both business and environmental objectives. By partnering with ExxonMobil, we’re harnessing the expertise and capabilities of one of the world’s largest energy companies to accelerate our ability to realize that vision."

ExxonMobil’s partnership with Global Thermostat expands the company’s collaborative efforts with other companies and academic institutions that are focused on developing new energy technologies, improving energy efficiency and reducing greenhouse gas emissions. The company recently committed to spend up to USD100 million over 10 years on research with the US Department of Energy’s National Renewable Energy Laboratory and National Energy Technology Laboratory to bring lower-emissions technologies to commercial scale. Since 2000, ExxonMobil has invested more than USD9 billion in energy efficiency and lower-emission technologies such as carbon capture and next generation biofuels. ExxonMobil also works with about 80 universities around the world to explore next-generation energy technologies.

As MRC wrote earlier, in October 2017, ExxonMobil Chemical Company commenced production on the first of two new 650,000 tons-per-year high-performance polyethylene (PE) lines at its plastics plant in Mont Belvieu, Texas. The full project, part of the company’s multi-billion dollar expansion project in the Baytown area and ExxonMobil’s broader Growing the Gulf expansion initiative, will increase the plant’s polyethylene capacity by approximately 1.3 million tons per year.

ExxonMobil is the largest non-government owned company in the energy industry and produces about 3% of the world's oil and about 2% of the world's energy.
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MOSCOW (MRC) -- Evonik has started up on schedule its new plant complex in Antwerp for production of fumed silica. With this, the specialty chemicals company can now serve the high demand for fumed silicas marketed under the AEROSIL brand, said the company.

Typical applications include paints and coatings, advanced adhesive systems, transparent silicones, and nonflammable high-performance insulation materials. Evonik has invested a sum in the upper double-digit million euro range in the new plant complex.

"We’re pursuing a clear growth strategy for our silica business. With the additional capacities, we’re ensuring supply for our customers over the long term,” said Harald Schwager, deputy chairman of Evonik’s executive board. As part of Smart Materials, silica belongs to one of Evonik’s four strategic growth engines with above-average market growth. The growth of the global market for fumed silicas is expected to exceed 4 percent annually, outpacing the global economy as a whole.

Along with the market for hydrophilic fumed silica, demand is also growing for specialty hydrophobic silicas. The existing plant in Antwerp has accordingly been upgraded such that hydrophilic fumed silica can be given hydrophobic properties by special post-treatment. Evonik therefore now produces hydrophobic AEROSIL at a second European site in addition to Rheinfelden, thus servicing continued high demand.

Andreas Fischer, member of the management board of Evonik Resource Efficiency GmbH, said: “We’re happy we’re now in a position to meet customer’s requests for higher quantities, in particular for hydrophobic AEROSIL®. The capacity to supply our own raw materials at the site, and its central location in Europe, were also especially important to us for this project. The site’s proximity to the international export port in Antwerp is an important factor in supplying our customers worldwide."

With the simultaneous modernization of the silane production plants as part of the investment, raw-material supply for AEROSIL® production as well as tire silanes is assured. AEROSIL is produced as fumed silica by high-temperature hydrolysis of silanes in a hydrogen flame.

As MRC informed earlier, Linde Group and the specialty chemicals company Evonik Industries in June 2018 concluded an exclusive cooperation agreement on the use of membranes for natural gas processing.

Evonik, the creative industrial group from Germany, is one of the world leaders in specialty chemicals. Its activities focus on the key megatrends health, nutrition, resource efficiency and globalization. Evonik benefits specifically from its innovative prowess and integrated technology platforms. Evonik is active in over 100 countries around the world.
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